The relation between knowledge investments and innovation in Small Enterprises: the moderating effect of organizational mechanisms

This paper aims at contributing to the research concerning knowledge management and innovation in small firms (SEs). Our arguments focus, within the RBV and knowledge debate, on the importance of managing organizational mechanisms for SEs innovation. The paper starts considering the relationship between knowledge investments and innovation, and the specific role played by organizational mechanisms and knowledge base. The study's hypothesis are tested on data collected from 164 SEs operating in a mechanical cluster located in central Italy. Results suggest that organizational mechanisms are critical for SEs' innovation.